Where india wakes up when oppression & tyranny pose a threat. No mercy, only protest through non-violent means
Tuesday, August 16, 2011
Sunday, August 7, 2011
U.S. RECESSION FEARS : Dollar to drop on S&P, flows seen to safe assets
The U.S. dollar is likely to take a further beating against the Swiss franc and Japanese yen on Monday, while global stocks could tumble after the United States lost its top-tier credit rating from Standard & Poor's. Losses against the euro, however, could be tempered by the euro zone's escalating debt crisis as officials there discuss ways to reduce borrowing costs for large euro zone economies Spain and Italy. The dollar's fall against the safe-haven Swiss franc and yen could be limited by possible intervention by the Bank of Japan and Swiss National Bank to stem their surging currencies. Stocks in Tel Aviv, one of the first global equity markets to open since the downgrade, dropped over 6 percent on Sunday in response to S&P's action late on Friday to cut the U.S. long-term credit rating by a notch to "AA-plus" from "AAA."
The move by S&P drew criticism from some of the world's largest investors. "Obviously, we're going to get freaked out a little bit and the dollar will get hit, but it's only going to be for a couple of days," said John Taylor, chairman and chief executive officer of FX Concepts, the world's largest currency hedge fund. Over the past month, the dollar shed 6 percent against the Swiss franc and about 4 percent against the yen. "This downgrade is not that important and if you ask me, too silly. The U.S. is in a much better position than any, I repeat, any European country," Taylor added.
It was not yet clear whether European policymakers would be able to come up with measures to allay concerns about their own region's fiscal crisis, though all the signs were that they were keenly aware of the importance of reassuring markets. Sources said the European Central Bank will hold a conference call at 1700 GMT to decide whether to buy Italian government bonds in the secondary market. One ECB source said that if the ECB council opted to intervene on Italy, the ECB and national central banks would start buying Italian bonds when markets open on Monday. The ECB last week resumed its purchases of government bonds in the secondary market after an 18-week hiatus, but its decision to restrict such purchases to Irish and Portuguese bonds led to sharp declines in Italian and Spanish bond prices, and borrowing costs soared to 14-year highs. "There is no reason why the ECB cannot simply go ahead and imply that they are going to support the Italians and the Spanish," said Mike Lenhoff, chief strategist at Brewin Dolphin in London. "It is better that they don't say anything, but go in and show there is another side to the market.". Any ECB buying would offer relief to beaten-down Italian and Spanish bonds, although the extent of any rally in these bonds will depend on the size and persistence of the bank's bond purchases.
U.S. RECESSION FEARS
Worries of another U.S. recession and concern about the euro zone crisis have sparked a global stock market slump that wiped $2.5 trillion off companies' values in the past week. The fall in global share prices, as measured by the MSCI All-Country World Index, was the biggest weekly decline since early October 2008, according to Thomson Reuters Datastream. Consumer discretionary shares of firms dependent on external demand are likely to be singled out for more punishment.
Still, some investors believed the expected sell-off in stocks on the U.S. credit downgrade had been largely priced in and may not last long. Some expressed doubts about the S&P decision as they are well aware of questions on the S&P's calculations of the projected U.S. fiscal deficits. "The U.S. track record -- over the past 200 years -- on its ability and willingness to fully service its debt is impeccable and the debt statistics should be interpreted not in isolation but in conjunction with the flawless track record of the U.S.," said Stephen Jen, managing director of SLJ Macro Partners in London, a global macro hedge fund. "This will have no lasting effects on financial asset prices," he added. U.S. Treasury debt yields are also expected to rise on Monday. Yields on benchmark U.S. 10-year Treasury notes rebounded to 2.56 percent on Friday, but were not very far from a record low of near 2 percent hit during the throes of the 2007-09 global financial crisis. The sharp swings in financial markets have piled pressure on policymakers. Finance ministers from the Group of Seven most developed economies are on Monday to discuss the U.S. sovereign rating downgrade and Europe's debt woes, Japanese news agency Kyodo reported on Sunday. "Be wary (Monday) of irrational depression as markets take flight," said Justin Urquhart Stewart, a director at Seven Investment Management in London. "We are dealing with the knowns and not the unknowns, but what we have a shortage of at the moment is political leadership."
Goldman Sachs strategists said there was a one-in-three probability of a U.S. recession due to the worsening European crisis, the possible failure to extend payroll tax cuts and elevated levels of joblessness, despite a slight dip in the U.S. unemployment rate in July. That would bode ill for the benchmark MSCI all-country index, which last week hit its lowest since September 2010 and has accumulated losses of more than 12 percent since late July. "Market sentiment appears acutely vulnerable given the build-up of concern on a sharper U.S. slowdown and speculation on the appropriate policy response and lingering fears stemming from the sovereign debt crisis in Europe," Citigroup strategists said in a note.
The move by S&P drew criticism from some of the world's largest investors. "Obviously, we're going to get freaked out a little bit and the dollar will get hit, but it's only going to be for a couple of days," said John Taylor, chairman and chief executive officer of FX Concepts, the world's largest currency hedge fund. Over the past month, the dollar shed 6 percent against the Swiss franc and about 4 percent against the yen. "This downgrade is not that important and if you ask me, too silly. The U.S. is in a much better position than any, I repeat, any European country," Taylor added.
It was not yet clear whether European policymakers would be able to come up with measures to allay concerns about their own region's fiscal crisis, though all the signs were that they were keenly aware of the importance of reassuring markets. Sources said the European Central Bank will hold a conference call at 1700 GMT to decide whether to buy Italian government bonds in the secondary market. One ECB source said that if the ECB council opted to intervene on Italy, the ECB and national central banks would start buying Italian bonds when markets open on Monday. The ECB last week resumed its purchases of government bonds in the secondary market after an 18-week hiatus, but its decision to restrict such purchases to Irish and Portuguese bonds led to sharp declines in Italian and Spanish bond prices, and borrowing costs soared to 14-year highs. "There is no reason why the ECB cannot simply go ahead and imply that they are going to support the Italians and the Spanish," said Mike Lenhoff, chief strategist at Brewin Dolphin in London. "It is better that they don't say anything, but go in and show there is another side to the market.". Any ECB buying would offer relief to beaten-down Italian and Spanish bonds, although the extent of any rally in these bonds will depend on the size and persistence of the bank's bond purchases.
U.S. RECESSION FEARS
Worries of another U.S. recession and concern about the euro zone crisis have sparked a global stock market slump that wiped $2.5 trillion off companies' values in the past week. The fall in global share prices, as measured by the MSCI All-Country World Index, was the biggest weekly decline since early October 2008, according to Thomson Reuters Datastream. Consumer discretionary shares of firms dependent on external demand are likely to be singled out for more punishment.
Still, some investors believed the expected sell-off in stocks on the U.S. credit downgrade had been largely priced in and may not last long. Some expressed doubts about the S&P decision as they are well aware of questions on the S&P's calculations of the projected U.S. fiscal deficits. "The U.S. track record -- over the past 200 years -- on its ability and willingness to fully service its debt is impeccable and the debt statistics should be interpreted not in isolation but in conjunction with the flawless track record of the U.S.," said Stephen Jen, managing director of SLJ Macro Partners in London, a global macro hedge fund. "This will have no lasting effects on financial asset prices," he added. U.S. Treasury debt yields are also expected to rise on Monday. Yields on benchmark U.S. 10-year Treasury notes rebounded to 2.56 percent on Friday, but were not very far from a record low of near 2 percent hit during the throes of the 2007-09 global financial crisis. The sharp swings in financial markets have piled pressure on policymakers. Finance ministers from the Group of Seven most developed economies are on Monday to discuss the U.S. sovereign rating downgrade and Europe's debt woes, Japanese news agency Kyodo reported on Sunday. "Be wary (Monday) of irrational depression as markets take flight," said Justin Urquhart Stewart, a director at Seven Investment Management in London. "We are dealing with the knowns and not the unknowns, but what we have a shortage of at the moment is political leadership."
Goldman Sachs strategists said there was a one-in-three probability of a U.S. recession due to the worsening European crisis, the possible failure to extend payroll tax cuts and elevated levels of joblessness, despite a slight dip in the U.S. unemployment rate in July. That would bode ill for the benchmark MSCI all-country index, which last week hit its lowest since September 2010 and has accumulated losses of more than 12 percent since late July. "Market sentiment appears acutely vulnerable given the build-up of concern on a sharper U.S. slowdown and speculation on the appropriate policy response and lingering fears stemming from the sovereign debt crisis in Europe," Citigroup strategists said in a note.
Saturday, August 6, 2011
Indian Affairs Reality Check: Indian Affairs Reality Check: $2.5 Billion In Swis...
Indian Affairs Reality Check: Indian Affairs Reality Check: $2.5 Billion In Swis...: "Indian Affairs Reality Check: $2.5 Billion In Swiss Banks & Counting – Our Hard ... : 'It's official now -- Indians hold about $2.5 billion ..."
Long Live Middle Class!
Middle class makes up for a sizable chunk of the society but that hasn’t really transformed into any sort of real power. Yes, numbers do matter and we can take to the streets a la, Jasmine revolutionaries or piggy riding on the likes of Anna Hazare or Yoga Rockstar, Baba Ramdev but that’s as far as we can go or think of going. Middle class is meant to suffer in the hands of politicians, bureaucrats and under the weight of its own expectations and ambitions.The idea of this post came from recent diesel and LPG price hike. Whether its rising inflation, increased commodity prices, skyrocketing real estates, nasty service tax/education cess or rising cost of everything under the sun, it’s essentially middle class population that has to bear the brunt. I wonder, whether all these talks of inflationary pressure on our household expenses has any effect on the rich echelons of the society?! The middle segment has neither the resources of the rich nor the fatalism of the poor who silently perish. For any government, middle class has always been a soft target.
There can’t be any cataclysmic change which will prove instrumental in uprooting this curse. On our part, Indian middle class is no less responsible for some of the mess. It has stopped the celebration of the ordinary and taken the baton of new superpower or new-age consumers high on the Viagra of more spending capacity, far too seriously. They call it ambition, moving to the next level but in reality, it is more likely a case of blatant mimicking of the ‘rich’.
Not long back, we had global financial meltdown. Agreed, it was triggered/conspired/instigated by the banking behemoths but segment that really suffered was middle class. Whether it was axing of jobs, reduction in salaries or inability to splurge, the “half-have’s” had it really tough. Yet, if we look closely at the phenomenon, the primary reason behind the breakdown can be attributed to people’s inability to save and useless addiction to splurge. All the large banks, mortgage firms, stock brokers, marketers, advertisers etc know all they need to do is to arouse that “I belong” feeling within the foolish middle class population.
Most of these victims couldn’t balance their own checkbook, so what they got was overdraft fees. No prizes for guessing, the banks forced them into not paying attention, right? They had to have those 50” 3D LCDs/Plasma because this will make them feel affluent. Again, they added that price tag onto their credit cards and yet they complained about lack of savings. The neighborhood uncle talked about this phenomenal stock that was going to give 1000% returns in a month and they got burned!
I am not done yet. Some of my friends/colleagues, typical middle-class junta but high on house mortgage, bonuses, perceived above average salaries, are not really familiar with what a budget is but will turn into gluttons once they come across a fast-food joint and will buy useless smartphones, without knowing what android refers to. Despite all that, the middle class wannabes still have the gumption to blame banks for all the horrible decisions taken by them. So either this category is completely brainless and blind when it comes to managing their finances or they should accept that they are spineless enough to be controlled by high-flying shrewd bankers from some dark dungeon board room or something!
This is basic Economics 101. But I am afraid, not many of them are really aware of game of economics or even history books which clearly states that, in the Crash of 1929 the politicians, the bankers and the elite, with connections in high places and enormous credit and cash reserves, bought up everything that was for sale. Yes, you read it right. The bourgeois never made money. Worse of all, this middle class always lives with one cherished delusion and that is, very presence of intellectual or artistic gifts masquerading as ‘divine attributes’ helping them in closing the distance with the ‘Have’s’. The hungry resourcefulness cannot be compensated by the careful pretensions of personas that are somehow inherently invested with a loads of aspirations colored in shades of self-pity.
The middle class segment of Indian society is anyways, the least privileged one. So, they should either accept the inevitable with a pinch of salt or try reducing the pain of reality by finding their “internal locus of control” in the bowels of their withering mind. And if nothing here written by me is making any sense then please, unplug your computer and stick a wet finger in the electrical socket.
Long Live Middle Class!
There can’t be any cataclysmic change which will prove instrumental in uprooting this curse. On our part, Indian middle class is no less responsible for some of the mess. It has stopped the celebration of the ordinary and taken the baton of new superpower or new-age consumers high on the Viagra of more spending capacity, far too seriously. They call it ambition, moving to the next level but in reality, it is more likely a case of blatant mimicking of the ‘rich’.
Not long back, we had global financial meltdown. Agreed, it was triggered/conspired/instigated by the banking behemoths but segment that really suffered was middle class. Whether it was axing of jobs, reduction in salaries or inability to splurge, the “half-have’s” had it really tough. Yet, if we look closely at the phenomenon, the primary reason behind the breakdown can be attributed to people’s inability to save and useless addiction to splurge. All the large banks, mortgage firms, stock brokers, marketers, advertisers etc know all they need to do is to arouse that “I belong” feeling within the foolish middle class population.
Most of these victims couldn’t balance their own checkbook, so what they got was overdraft fees. No prizes for guessing, the banks forced them into not paying attention, right? They had to have those 50” 3D LCDs/Plasma because this will make them feel affluent. Again, they added that price tag onto their credit cards and yet they complained about lack of savings. The neighborhood uncle talked about this phenomenal stock that was going to give 1000% returns in a month and they got burned!
I am not done yet. Some of my friends/colleagues, typical middle-class junta but high on house mortgage, bonuses, perceived above average salaries, are not really familiar with what a budget is but will turn into gluttons once they come across a fast-food joint and will buy useless smartphones, without knowing what android refers to. Despite all that, the middle class wannabes still have the gumption to blame banks for all the horrible decisions taken by them. So either this category is completely brainless and blind when it comes to managing their finances or they should accept that they are spineless enough to be controlled by high-flying shrewd bankers from some dark dungeon board room or something!
This is basic Economics 101. But I am afraid, not many of them are really aware of game of economics or even history books which clearly states that, in the Crash of 1929 the politicians, the bankers and the elite, with connections in high places and enormous credit and cash reserves, bought up everything that was for sale. Yes, you read it right. The bourgeois never made money. Worse of all, this middle class always lives with one cherished delusion and that is, very presence of intellectual or artistic gifts masquerading as ‘divine attributes’ helping them in closing the distance with the ‘Have’s’. The hungry resourcefulness cannot be compensated by the careful pretensions of personas that are somehow inherently invested with a loads of aspirations colored in shades of self-pity.
The middle class segment of Indian society is anyways, the least privileged one. So, they should either accept the inevitable with a pinch of salt or try reducing the pain of reality by finding their “internal locus of control” in the bowels of their withering mind. And if nothing here written by me is making any sense then please, unplug your computer and stick a wet finger in the electrical socket.
Long Live Middle Class!
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